Tariffs-related stockpiling boosts US goods trade deficit to record high
Source: Reuters
April 29, 2025 1:00 PM EDT Updated 6 hours ago
WASHINGTON, April 29 (Reuters) - The U.S. trade deficit in goods widened to a record high in March as businesses ramped up efforts to bring in merchandise ahead of President Donald Trump's sweeping tariffs, suggesting trade was a large drag on economic growth in the first quarter. While some of the imported goods ended up in warehouses at wholesalers, economists said this would not blunt the anticipated hit on gross domestic product from the deterioration in the trade deficit.
The report from the Commerce Department's Census Bureau prompted economists to sharply downgrade their GDP estimates for last quarter to show a steeper decline rather than growth just stalling. Goldman Sachs now sees GDP contracting at a 0.8% annualized rate while JPMorgan forecasts output declining at a 1.75% pace. The economy grew at a 2.4% rate in the fourth quarter.
The government is scheduled to publish its advance GDP estimate for the January-March quarter on Wednesday, which will coincide with Trump's 100 days in office.
The disruptions wrought by Trump's ever-shifting tariffs position, which has sowed confusion and uncertainty among households and businesses, were also evident in other reports on Tuesday. Consumer confidence plunged to a nearly five-year low in April, while job openings in March decreased to the lowest level since last September. But businesses are not yet responding to the heightening uncertainty by firing workers, likely keeping the economy afloat for now.
Read more: https://www.reuters.com/business/us-goods-trade-deficit-widens-sharply-march-2025-04-29/
Commerce Department/Census Bureau PRESS RELEASE - Advance Economic Indicators Report - March 2025